Buying Japantowns is a Booming Business
3D Investments now owns key landmarks in two out of three of the last U.S. Japantowns.
Los Angeles' Little Tokyo didn't see it coming. In the afterglow of Nisei Week festivities, community members were blindsided by news of the sale of two of its key landmarks to 3D Investments.
Yes. The same 3D Investments that snatched up two hotels last year in San Francisco's Japantown, now owns Little Tokyo's New Otani Hotel and Weller Court. The sale, which closed Aug. 17, was shrouded in secrecy and set tongues wagging about the intent of the private Beverly Hills, Calif.-based real estate developer.
A sale of any business in Little Tokyo is noteworthy for the tight-knit community, but in the last two years 3D has staked claim of two of the last three historic Japantowns in the United States.
Is 3D in the Japantown business?
In the immediate aftermath of the sale going public, both 3D and the seller, East West Development Corp., remained secretive about the details. The sale price has not been disclosed and the new owners have remained tight-lipped about their intentions. Even local elected officials were left in the dark.
"Right now, I don't even know what their phone number is yet," said Los Angeles Councilwoman Jan Perry about 3D's difficult to find contact information. She wants to talk to them because they are moving into her district. "I think the developers need to be respectful of the community's concern."
East West Development is bound by a confidentiality agreement, said its president Takashi Ito exclusively to the Pacific Citizen.
"They didn't want the closing of the deal to be delayed because of community uproar," Ito said about 3D.
Taking Action
East West was not planning to sell the New Otani or Weller Court, said Ito. The company has spent a lot of money renovating the landmarks in the last few years.
3D contacted East West and made them an offer they could not refuse.
The private Beverly Hills company is making plans to meet with community leaders gradually and plans to make an announcement later this month, said Ito.
"They are not going to change any concept. They value Japanese culture. They are not a company interested in just making money," he added.
Ito points to 3D's track record. Right now, they are handling over 140 projects and they've kept all their projects longer than 10 years, he said.
One of 3D's holdings famously includes San Francisco Japantown's two hotels plus two-thirds of the Japantown mall. Last year's sale of the key landmarks in the 100-year-old area created turmoil and a "Save Japantown" movement that required 3D to maintain a Japanese theme and to not sell the mall for 15 years.
A year after the Japantown sale, 3D and Joie de Vivre Hospitality, the San Francisco-based hotel operator, has revamped the 125-room Best Western Miyako Hotel with J-Pop and anime themed décor. Renamed Hotel Tomo, the rooms burst with vibrant wall paintings of Japanese art and Harajuku inspired photography.
The hotel's new owner must understand the difference between Japanese culture and Japanese American culture, critics say.
"Both cultures are important to the holistic JA community. However, a community cannot simply be a collection of Japanese restaurants and anime shops. It must also include historical residents, community based organizations, community events and gatherings," said Craig Ishii, JACL Pacific Southwest regional director who stayed at Hotel Tomo for the recent JACL board meeting.
In Los Angeles, where questions continue to linger weeks after the sales were finalized, community leaders are demanding answers.
A special task force was constituted to investigate and address the recent sales after an Aug. 29 informal meeting, said Chris Aihara, executive director of the Japanese American Cultural & Community Center in Little Tokyo.
Representatives from 3D met with Aihara for lunch Sept. 4 to discuss concerns and plans for the future. The new owners said they are looking to maintain the quality of the hotel and shopping center, but they don't have any specific plans yet, said Aihara, who gave them a copy of the Little Tokyo Planning and Design Guidelines and discussed the importance of the district's history.
"They said the success of Little Tokyo is to their best interest," said Aihara.
The fact that 3D has now bought property in two of the last three Japantowns raises red flags, she added.
"I think that's one of the things that we would like to talk about. I know the sale in San Francisco was not easy and not without controversy," she said. "We would like to work in unity in the community to establish stronger objectives and set a precedence for future development."
Little Tokyo's First Street has national historic designation, but not the community overall, added Aihara. "I think the next step is we need to push for area protection."
But Little Tokyo isn't the same place the Nisei called home - it's changing and the sale of its key landmarks may be signifying a new future out of the hands of JA community groups.
"Even though the name is Little Tokyo ... a lot of the businesses have now been sold to non-Japanese companies," said Ito.
Little Tokyo's Changing Face
"We have already seen signs," said Tom Kamei, a former structural engineer who helped build and design about 20 buildings in Little Tokyo. These days, the Kibei Nisei from Pasadena walks the streets of the community he helped to redevelop and sees corporate names like Subway and Pinkberry.
"I guess it was only a matter of time."
Little Tokyo has always been in flux. Before Weller Court's retail shops and restaurants, the now pedestrian-only Astronaut E. S. Onizuka Street was named Weller Street, according to Kamei, past president of the Little Tokyo Community Council and a board member of the Japanese Chamber of Commerce.
It was also the hub of Japanese American community activity with a three-story brick building that housed a number of community and cultural organizations. At the corner of Weller and East 1st Streets a very popular restaurant once served authentic sushi for the first time in Los Angeles. But it all had to be sacrificed for the new hotel and retail shopping mall that stands today.
The 21-story, 434-room New Otani Hotel opened in 1977 despite community protest. In Weller Court, Kamei put a little of himself in the design of the structure. Now, the blind sale has embittered the community that originally sacrificed its space for the landmarks.
"I feel very bad about this," said Kamei. "I put my heart and soul into it and to see it taken away from us is terrible."
During a recent weekend Ondo Festival, talk centered around the sale. Amidst the dancing and festivities, people passed around newspaper articles and expressed amazement and irritation that the sale had gone on without any input from the community.
The New Otani and Weller Court are important landmarks and backdrops for community celebrations and events, said Perry.
With all the ownership changes, the community has been grappling with an unsettling feeling. In July, American Commercial Equities bought the Japanese Village Plaza, a 29-year-old outdoor mall, for an undisclosed amount. The new owner announced upgrade plans for the plaza, but longtime tenants worry about rent increases or worse - getting pushed out.
American Commercial has met with community leaders a few times, but more follow up is needed, said Aihara.
Almost overnight, luxury loft and condominium complexes have changed the skyscape and face of Little Tokyo. Next to the Hikari, a multi-level apartment building on the corner of Second and Central Avenue, sushi restaurants stand like sentinels from Little Tokyo's past. Starting at $1,650, Angelenos can live in Hikari's one-bedroom studio and overlook Honda Plaza, an old Little Tokyo mainstay.
"Little Tokyo is in danger," said Ishii. "I see Little Tokyo in danger of further losing the sense of community that it used to have."
Japanese Enclaves of the Future
It didn't take long for Little Tokyo's news to get to San Jose Japantown. At an Aug. 28 community meeting, talk was focused on 3D's purchases in San Francisco and now Los Angeles.
After all, San Jose's Japantown is the last enclave uncharted by 3D.
"People have been wary about it. What kind of company is it?" said Kathy Sakamoto, executive director of the San Jose Japantown Business Association.
Rumors have been swirling about 3D seeking to buy other properties near San Francisco's Japantown. But San Jose is not worried.
"Everything here is owned by organizations or people, not big companies. If 3D were to come here, it would take a lot to buy a block because they have to talk to so many people," said Sakamoto.
In Los Angeles, however, the tension is palpable.
"Even right now I don't know why [Kajima] sold it," said Shigeki Matsuda, owner of Orochon Ramen, a popular restaurant on the third floor of Weller Court. "They may change everything. They may put in American shops. I don't know anything. Of course I'm concerned."
Matsuda is in an especially vulnerable position - his restaurant's five-year lease is up at the end of the month. He has another five-year option, but he doesn't know who to talk to.
On a hot weekend as the lunch hour crowd begins to stream into his restaurant, Matsuda says if he opens up another restaurant, he would scout out locations in other Japanese enclaves in West Los Angeles' Sawtelle District or Torrance. But he wants to maintain a presence in Little Tokyo.
"This is where my customers are," he said.
For many, Little Tokyo is more than just eight blocks of city space. Kamei was born on Terminal Island, a former Japanese community located between Los Angeles and Long Beach harbors. Now his hometown has turned into an industrial wasteland.
"I've been in and around this area working and being part of different community organizations since 1950," said Kamei about Little Tokyo. "I feel that this is my hometown. The place where I was born is gone. This is my hometown. It's very dear to me. It's shocking to see what's happening."
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